Kodak: Simplicity and Features over Megapixels

Kodak
Defines Need to Drive Mass-Market Acceptance of Digital Photography. In
a keynote to a group of leading industry executives at the "Advance
Digital Photography Forum 2000", Daniel A. Carp (Kodak CEO) talks
about consumers and mass-market acceptance of digital cameras.

BOSTON--(BUSINESS WIRE)--April 10, 2000--Eastman
Kodak Company President and CEO Daniel A. Carp today described how Kodak
and the industry need to better promote the consumer benefits of digital
pictures rather than the number of pixels in a digital camera.

During a keynote address to a group of
leading industry executives at the Advancing Digital Photography Forum
2000, presented by Lyra Research, Inc., Carp described how the industry
and Wall Street treat digital as a ``magic'' word, while consumers are
far more interested in features and benefits rather than the pixel count
of a CCD image sensor. He emphasized that the word digital does not provide
consumers with a compelling enough reason to change their picture-taking
habits.

``We know very well what digital means
to us...and to industry analysts...and to Wall Street,'' Carp said. ``But
what does it really mean to the public? To consumers, the word 'digital'
does not always mean better. For example, expensive fashion watches are
analog; less expensive watches are almost always digital.

``Kodak is convinced that there has never
been a better time to be in the picture business. And not just because
digital has created some new excitement. What's more intriguing is how
digital can change the way people take and use pictures. Suddenly, there
are no boundaries to how often you can take pictures, because film cost
or availability is no longer an issue. There are no boundaries limiting
when you can take pictures, because digital cameras have conveniently
become hooked into everything, from telephones to the new Kodak PalmPix
camera that attaches to your Palm organizer.

Carp went on to describe a watershed
moment in modern photography, the introduction of the Brownie camera by
Kodak founder George Eastman. The Brownie camera, introduced in 1900,
is widely viewed as the product that transformed photography from a technically
challenging, costly, professional activity to an easy, inexpensive and
mass-market one.

``George Eastman's new technology was
far more economical and convenient than anything that preceded it. All
he lacked was a mass market for this new system of picture taking. If
Eastman were a product of the Internet age, he might have been tempted
to sell his new system as a glamorous piece of new technology, with ads
and press releases hyping the wonders of 'nitrocellulose roll film photography'.

``Of course, he didn't. Instead, he showed
people how simple and fun it was to take pictures,'' Carp continued. ``He
suggested when and where people should take pictures; he provided guidance
on who should take pictures; he gave people plenty of reasons why they
should take pictures. And he left no doubt about the modest cost of taking
pictures. All things the industry should be doing today to drive mass-market
acceptance of digital photography products and services.

``These days, though, it will take more
than one company to change a century of consumer habits and perception.
With the participation of the entire industry, I am confident that we
can lead the way toward a more picture-rich era, and that, together, we
can break through the technical and marketing challenges facing our industry.''

A full transcript of Carp's speech is available at Kodak's
website www.kodak.com.

Presented by Lyra Research, the Advancing
Digital Photography Forum conference brings together, in an open and constructive
environment, hundreds of top executives from virtually every corner of
the digital photo industry to hear and discuss analyses of the near-term
future of digital photography, technology and markets. More information
about Lyra Research is available at www.lyra.com.